Are Stocks Late Day Fade a Cause For Concern, or More of The Same?

This column is my opinion and expresses my views. Those views can change at a moments notice when the market changes. I am not right all the time and I do not expect to be. I disclose all my positions clearly listed on the page, and I do not trade my account on the stocks spoken of in this column unless fully disclosed. If that does not work for you stop reading and close the page. Do not bother me or harass me.

Otherwise, enjoy the column!

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Michael Kramer owns SPY calls

Michael Kramer and the clients of Mott Capital own NXPI

Where Are Stocks Going?

Stocks should continue to see gains in the days ahead despite the late day pullback on March 19. The charts and fundamental valuations continue to show a favorable outlook for the S&P 500, and today’s fade seemed more like a technical gap fill than the start of something more severe, despite the negative trade headlines.  Nothing from today’s trading has changed my view of the S&P 500 eventual rise to around 2,900 and potentially higher over the next couple of weeks.

I could even argue that my outlook is a bit brighter given the big move higher in Amazon’s stock throughout the day.

S&P 500 (SPY)

The chart below shows that the S&P 500 gapped higher, only to close that gap by days end. Again, we have seen this multiple times in the past and today’s move is nothing new. Mr. Predictable.

S&P 500, spy

Russell (IWM)

The Russell did fall today, but it also continues to hang around the 1,562 level. The setup in the chart is still favorable and suggests an eventual take-out of the 1,592 level and move up to around 1,710.

Russell

Amazon (AMZN)

Amazon was the big winner today, rising and finally clearing that $1,770 level, although it did give back some of those gains by days end. However, I suspect tomorrow may be different. We can see in the chart, that volume levels have risen on the days the stock has increased, a sign of strong buying.  I reviewed Amazon Breaks Out today in my premium area. amazon, amzn

AMD (AMD)

Another stock having a big move today is AMD up over 11% after Google confirmed a partnership for a new streaming gaming platform. AMD crossed over a critical level of resistance today at $25.70. I think that the shares may eventually climb back to around $29.50.

AMD

Micron (MU)

Micron continues to rise, albeit with the tailwind of a hot Semiconductor sector behind it. But now things may get tough for the stock as it approaches that wall of resistance around between $40 and $42. The company reports results tomorrow. I haven’t seen much to sway my opinion from the other day. Here’s Why Micron May Plunge After Its Quarterly Results

Micron, mu

Nvidia (NVDA)

I noted this in my StockTwits premium room that it looks like Nvidia is intent on filling that giant gap up at $198.  This is a new point of view for me, but sometimes we need to change when realizing we are wrong.

Nvidia, nvda

NXP (NXPI)

NXP Semiconductor has a bullish flag pattern forming, which would suggest a break out may be on the way resulting in a rise to around $106.

NXP

FedEx (FDX)

Note: my data provider had the wrong release date. The company reported weaker than expected results and guidance after the close of trading on March 19, resulting in shares falling. The company noted in the release: “Slowing international macroeconomic conditions and weaker global trade growth trends continue, as seen in the year-over-year decline in our FedEx Express international revenue,” 

Talk about being in a tight spot, FedEx reports results tomorrow, and the chart shows you just how torn the market is. The stock is resting right on the cusp of a major break out or break down.  The shares have failed multiple times to rise above $184. For the sake of the global economy, I hope FedEx has something good to say. There is a gap to be filled up around $200, and the relative strength index is starting to trend up. With that, I will guess that FedEx rises following results and head back towards $200.

 

fedex

Have a great night!

-Mike

Photo From Flickr

Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future.  March 19

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